U.S. Attorney Announces Guilty Plea in Multimillion-Dollar Mortgage and COVID Loan Scheme

NEWARK, NJ — The U.S. Attorney’s Office for the District of New Jersey announced Thursday afternoon that a prominent real estate investor pleaded guilty before U.S. District Judge Susan D. Wigenton to federal charges of bank fraud and money laundering in connection with an $8.4 million fraudulent loan operation.

Fraudulent Schemes and Bank Fraud Statues

According to court documents and statements made in federal court, the defendant fabricated corporate tax returns, falsified commercial property lease rolls, and created shell entities to illicitly obtain multi-million-dollar mortgages from federally insured financial institutions, alongside Paycheck Protection Program (PPP) and Economic Injury Disaster Loans (EIDL). The proceeds were diverted into personal luxury real estate acquisitions and offshore accounts under the guise of legitimate commercial renovations.

The prosecution was coordinated through the Justice Department’s COVID-19 Fraud Enforcement Strike Force in partnership with the FBI and IRS Criminal Investigation.

Federal Sentencing Guidelines and Asset Forfeiture

The charge of bank fraud carries a maximum statutory penalty of 30 years in federal prison and a $1 million fine. Under the terms of the plea agreement, the defendant agreed to pay $8.4 million in mandatory restitution and forfeit seized residential properties in Essex and Bergen counties.

Federal prosecutors affirmed that investigating pandemic relief fraud remains an active, nationwide DOJ enforcement priority.

Sentencing Hearing Scheduled

Judge Wigenton scheduled formal sentencing for January 14, 2027, in U.S. District Court in Newark.